Chinese exporters elated by reprieve in US China trade war

BEIJING – The US-China deal temporarily lowering tariffs comes as a relief for Chinese exporters in limbo since the onset of a trade war between the world’s two largest economies.

The Trump administration’s 145 per cent duties on most Chinese imports will be cut to 30 per cent by May 14, while China’s 125 per cent retaliatory levy on US goods will drop to 10 per cent during a 90-day cooling off period, Beijing and Washington said on May 12 following negotiations in Geneva.

For one Shanghai-based medical equipment maker, the joint statement easing trade tensions will allow it to shelve planned job cuts and production line closures slated for later this month. That will provide some breathing room, but won’t alter efforts to shift some manufacturing out of China and avoid the remaining tariffs, said Ms Pang Ling, a sales manager of the company which employs hundreds of workers and relies on the US for about half of its US$70 million (S$91 million) in annual sales.

“Now, we don’t need to let anyone go,” she said in a phone interview. “I’m confident about this year’s sales from the US again.”

Many Chinese factories that make everything for export from coffee machines to yoga pants have halted shipments to the US and idled assembly lines – with some operating just three or four days a week – after US President Donald Trump singled out China for especially high tariffs in April.

Demand soared for many Chinese-made products on e-commerce platforms like Shein Group and PDD Holdings’ Temu before tariffs came into effect. Sales on the two platforms tanked afterward.

For Mr Sun Yang, who owns a business selling face- and body-painting tools such as brushes and colour palettes on Temu’s online marketplace, the good news could not come soon enough